Harmohinder Singh Gill (as Trustee of the Gillcrest UK Pension Scheme) v Lees News Limited

Under Part II of the Landlord and Tenant Act 1954, the court may assess fault-based grounds by considering the tenant’s conduct from the notice or counter-notice through to the hearing. Later remedial work is relevant, but it does not erase earlier breaches. The question whether a tenant ought not to receive a new tenancy is a value judgment about fairness to the landlord, informed by the tenant’s overall performance, the landlord’s attitude, future compliance and the tenant’s circumstances. The grounds should not be considered in isolation where their cumulative effect is relevant. Litigation conduct may exceptionally justify refusal, but that will be rare. An appellate court should not interfere with a trial judge’s evaluative conclusion absent legal error.

The tenant requested new tenancies under section 26 of the Landlord and Tenant Act 1954. The landlord opposed renewal on grounds including disrepair, persistent delay in paying rent and other substantial breaches under section 30(1). The trial judge found substantial disrepair and persistent rent delay at the date of the counter-notices, but found that the disrepair had been remedied and that the remaining breaches were insufficient to justify refusal. New tenancies were ordered. Richards J dismissed the landlord’s appeal: [2023] EWHC 403 (Ch). The Court of Appeal considered the material dates and the proper scope of the question whether the tenant ought not to be granted a new tenancy.

1. Appeal dismissed. Lord Justice Lewison delivered the judgment, with Popplewell and Dingemans LJJ agreeing. The court’s focus on this second appeal was whether the trial judge had adopted the correct legal approach and reached a conclusion open to him.
2. For grounds (a), (b) and (c) under section 30(1) of the Landlord and Tenant Act 1954, the court is not confined to a single snapshot. Under ground (a), the state of repair at both the date of the notice or counter-notice and the date of the hearing may be relevant. Remedial work before trial is important, but earlier serious disrepair and the tenant’s record of performance may still be considered. Grounds (b) and (c) likewise permit consideration of the tenant’s wider performance during the tenancy (paras [20]–[39]).
3. The phrase ought not requires a value judgment whether it would be fair to the landlord, having regard to the tenant’s past performance and behaviour, to compel a further legal relationship. The inquiry is not confined to the landlord’s interests or to the particular breach forming the pleaded ground. Part II protects the tenant’s business interests and security of tenure. Future compliance, the landlord’s attitude to performance, the consequences for the tenant and other special circumstances may therefore be relevant (paras [40]–[54], [64]–[68]).
4. The court rejected a compartmentalised approach to grounds (a), (b) and (c). Relevant collateral matters may be considered, and the grounds may be assessed both individually and cumulatively. Hutchinson v Lamberth was preferred to the contrary approach in Youssefi v Musselwhite, whose relevant passage was treated as non-binding obiter (paras [55]–[62]). Exceptionally serious litigation conduct may itself justify refusal, but proceedings connected with the renewal application will rarely reach that threshold (para [72]).
5. The trial judge had stated and applied the correct test. His assessment of the landlord as a hands-off commercial landlord, the tenant’s livelihood and the prospects of future compliance was permissible. The criticism based on the judge’s phraseology required an impermissible minute textual analysis. The tenant’s proposed additional point concerning clause 2(8)(b) had not been pursued below and was not permitted to be raised on the second appeal (paras [63]–[73]).

• Court of Appeal (Civil Division) dismissed the landlord’s second appeal: [2023] EWCA Civ 1178 .
• High Court, Chancery Division dismissed the landlord’s appeal from the trial judge: [2023] EWHC 403 (Ch) .
• County Court found that grounds of opposition based on disrepair and rent delay existed at the date of the counter-notices, but held that the tenant ought not to be refused new tenancies.